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Which is Best, Seeking Alpha Vs Simply Wall Street Vs Morningstar Vs Zacks Vs TipRanks?

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How does Seeking Alpha compare with other stock research and analysis platforms such as Simply Wall Street, Morningstar, Tipranks and Zacks?

What are the key differences between them?

Most importantly, how do you decide which one is the best and most helpful for you?

Seeking Alpha Vs Simply Wall Street

How does Seeking Alpha Premium compare with Simply Wall St?

Which is better for you?

Both Seeking Alpha Premium and Simply Wall St are stock research and analysis platforms.

All the stock analysis reports by Simply Wall St are generated automatically in the same format, using data pulled from company financials as well as analyst’s revenue estimates.

There are a total of 10 sections in the stock report:

  • Executive Summary
  • Share Price & News
  • Valuation
  • Future Growth (i.e. future revenue and earnings estimate by analysts)
  • Past Performance
  • Financial Health (i.e. financial ratios such as debt to equity ratio)
  • Dividend
  • Management
  • Ownership
  • Company Information

Personally, I think that only the “Valuation” and “Future Growth” sections might be of some value to you in helping you make an investment decision.

But, “Valuation” and “Future Growth” are calculated based on analysts’ estimates and are NOT 100% accurate.

Also, you can get “Valuation” and “Future Growth” data from many other stock research and analysis platforms such as “Stock Rover“, “Seeking Alpha” and “Morningstar“.

All the other sections inside Simply Wall Street (e.g. “Share Price & News”, “Past Performance”, “Dividend”, “Ownership”, etc),  you can easily get the same information for free online.

So, after going through everything, you can see that the main advantage of using Simply Wall St is that basic financial data and ratios are presented to you in an easy-to-read graphical format.

If you are a new investor, you might find this format very beginner friendly.

The financial information and data on Simply Wall St are much easier to read in graphs and tables.

Also, Simply Wall St covers a lot of international stock markets.

So, that will be good for you if you are investing internationally.

However, what I don’t really like about Simply Wall St is that the financial information and data provided are just too basic and general for stock research and analysis.

On top of that, I don’t feel that there is anything really unique or proprietary about Simply Wall St.

Seeking Alpha Premium, on the other hand, has all the financial information and data (i.e. US stocks as well as international stocks) that you can find on Simply Wall St plus more.

Its proprietary Quant Rating, Author Rating, and Wall Street Rating can help you filter through thousands of stocks easily and also help you identify the best investment opportunity.

Its Top-Rated Stock list which consists of all the stocks with the top ranking in all of the Quant Rating, Author Rating, and Wall Street Rating is updated daily, so you will never miss any good investment ideas.

The thing that I love the most about Seeking Alpha Premium is the in-depth stock analysis.

What is more, I find it especially useful to go through opposing camps of views on the same stock that I am doing research on.

Why?

Because it really helps me consider all the potential risks and future opportunities involved before making my decision.

For example, you can see the stock analysis articles published by both the Apple bulls and Apple bears.

Pricing-wise, Simply Wall St has three different pricing plans:

  • Free
  • Premium ($10/month)
  • Unlimited ($20/month)

On the other hand, Seeking Alpha also provides three types of pricing plans:

So, Simply Wall St Unlimited is priced cheaper than Seeking Alpha Premium, but I think you can get so much more value by subscribing to Seeking Alpha Premium.

Right now, there is a 7-day free trial for you to test drive risk-free and see if it works for you.

[Limited Time Only] Claim Your 20% OFF Seeking Alpha Premium & Try It For 7 Days Free

Seeking Alpha Vs Morningstar

How does Seeking Alpha compare to Morningstar?

Both Seeking Alpha and Morningstar provide stock ratings as well as a lot of financial and fundamental data on stocks.

The key difference is that Morningstar is specifically focused on helping you find good-quality stocks for long-term appreciation.

If you are a value investor, you might find Morningstar very helpful because it helps you identify all the good companies and also all the companies that are currently undervalued.

It does so by providing proprietary stock ratings, valuations, and research reports. 

On the other hand, Seeking Alpha Premium is a set of comprehensive tools and analyses to help you take the guesswork out of your investing decisions.

It helps you get a better understanding of any stock with its stock ratings (i.e. Quant ratings, Author ratings, and Wall Street ratings), in-depth stock analysis as well as comprehensive financial and fundamental data.

You can see that both Seeking Alpha Premium and Morningstar provide stock ratings.

So, the question is, how are these stock ratings different?

Let’s first look at how Morningstar rates stocks.

Morningstar adopts a stock-picking approach that focuses on long-term advantages and intrinsic value.

To help you gauge whether or not a company has “long-term advantages” over its competitors, Morningstar provides you with economic moat ratings for each stock.

There are three types of economic moat ratings:

  • Wide (i.e. highest moat rating)
  • Narrow
  • Non

Companies with a “Wide Moat” rating have the most sustainable competitive advantages.

And these companies are the best for long-term investments.

So, how do you know which wide-moat stocks you should buy and when you should buy them?

This brings us to Morningstar’s stock Star Rating.

Morningstar’s Star Rating gives you an idea of the stock’s current valuation.

In other words, it tells you whether the stock is above its fair value, below its fair value, or near fair value.

It’s calculated by comparing a stock’s current market price with Morningstar‘s estimate of the stock’s fair value.

So, here’s how star ratings work.

The further the market price is below the fair value, the higher the star rating (with 5-star being the highest and 1-star being the lowest).

A 5-star rating means that the stock is trading meaningfully below fair value, which means it’s a good price to buy.

On the other hand, a 1-star or 2-star rating means that the stock is trading meaningfully above fair value.

A 3-star rating means the stock is trading near fair value.

Is Morningstar Fair Value Estimate reliable?

Morningstar calculates its fair value estimate based on its estimate of how much cash the company will generate in the future.

As you all know, no one can predict the future with 100% accuracy.

That’s why Morningstar takes into account “the predictability of company’s future cash flow”.

The less predictable (or uncertain), the higher the margin of safety is required for a 4-star or 5-star rating.

For example, Mcdonald’s future cash flow is more predictable and stable than Lions Gate Entertainment’s.

For Lions Gate Entertainment stock to be assigned a 4-star or 5-star rating, its current market price must be much lower than its fair value estimate.

All in all, I think Morningstar ratings and fair value estimates are useful, but I would only use them as one of my sources to find investment ideas.

So, how do you use Morningstar Premium to find good investment ideas?

Personally, I like its “Wide-Moat + Undervalued Stock” list which shows you all the stocks with a Wide Moat Rating and a Star Rating of 4 or 5 stars.

Basically, you can find all the highest quality companies that are trading below their fair value on this list.

These are considered relatively safer stock picks than just picking a stock from the “Five Star” list or “Wide Moat” list.

Now, what about Seeking Alpha Premium stock ratings?

For each stock, you can find the latest Seeking Alpha Premium ratings on the stock:

  1. SA Author Ratings ‒ ranging from Strong Buy to Strong Sell
  2. Wall Street Ratings – consensus and price targets on the stock by Wall Street Analysts
  3. Quant Ratings ‒ based on over 100 metrics, updated daily

The most interesting of all is its proprietary Quant rating.

It was developed by CressCap, a quantitative analytics and data platform that was acquired by Seeking Alpha.

So, what exactly is Quant Rating, and how does it really work?

Quant rating is derived by comparing over 100 metrics for the stock to the same metrics for the other stocks in its sector.

These metrics include the company’s financial data, stock price performance, and analysts’ estimates of future revenue and earnings.

There are five types of Quant ratings:

  • Strong Sell (i.e. a score of 1)
  • Sell  (i.e. a score of 2)
  • Hold (i.e. a score of 3)
  • Buy (i.e. a score of 4)
  • Strong Buy (i.e. a score of 5)

The advantage of this method is that you can use Quant Rating to find the best performer of any particular industry or sector.

So, how exactly is Quant Rating calculated?

Quant Rating is derived after taking into account the following five “Factor Grades”:

  • Value
  • Growth
  • Profitability
  • Momentum
  • EPS Revisions

The Factor Grade is determined by comparing the relevant metrics for the factor for the stock to those for the other stocks in the same sector.

For example, to determine the grade for the “Growth” factor,  metrics such as past sales growth, projected earnings growth, and stock price performance for the stock will be compared to the same metrics for the other stocks in the same sector.

Then, each factor is assigned a grade, from A+ to F.

Grade A+ means that the stock has the highest growth potential compared to its peers in the same sector.

On the other hand, a grade of F means that the stock has the lowest growth potential compared to its peers in the same sector.

So, how do you use Seeking Alpha’s Factor Grades?

The value, growth, and profitability grades give you a snapshot of the stock’s fundamentals, while the momentum and EPS revisions grades tell you if the stock is gaining momentum.

So, if you are looking for value stocks, you just filter out all the stocks with a “Value” Grade of A or A+.

After that, you further research and analyze these value stocks one by one.

The advantage of Factor Grade is that you get a very quick idea of what type of stock it is. (e.g. a value stock? a growth stock? momentum stock?)

Here’s one of the best ways to make use of Seeking Alpha ratings.

Every day, Seeking Alpha also publishes a list of stocks that earn top ratings from Seeking Alpha authors, Wall Street analysts, and its proprietary Quant System.

Personally, I think that just this list of Top-Rated Stocks is like a gold mine that could potentially help you increase your investment returns significantly. 

So, how have Seeking Alpha’s Strong Buy Recommendations compared against the S&P 500?

Do take note that the performance is based on backtesting.

From 2010 to 2022, Seeking Alpha Strong Buy achieved a total return of $174,156 based on $10,000 in investment capital while the S&P 500 achieved a total return of $40,721.

Seeking Alpha Premium’s Top Rated Stocks routinely turns up opportunities that you probably won’t hear of anywhere else yet.

As for Morningstar, there is no performance data available.

So, which stock ratings should you use to help you with your investment decisions?

Well, Morningstar ratings are more suitable for value investors while Seeking Alpha Premium ratings can be used by long-term investors as well as short-term stock traders.

Now, what about other differences between Morningstar Premium and Seeking Alpha Premium?

Seeking Alpha Premium gives you tons of useful financial and fundamental information (i.e. Earnings, Valuation, Growth, Profitability, Peers, Dividend, Earnings Transcript, etc) on the stocks you are researching or stocks that you own in your portfolio all in one place.

On the other hand, Morningstar Premium cannot really match Seeking Alpha in this aspect.

Let’s use Apple as an example to go through the stock research and analysis tools inside Seeking Alpha Premium.

However, Morningstar Premium does provide good analyst research reports and news analyses on stocks.

For Seeking Alpha Premium, you can get access to stock analysis that is crowd-sourced from the investing community.

Personally, I find some of the stock analysis articles are very in-depth and are as good as the analyst report (if not better).

To me, the most valuable part is to get to read stock analysis from the two opposing camps (bulls vs bears) on the same stock.

I like it because it really helps me assess the risks involved in the stock.

In terms of pricing, Morningstar Premium memberships are available at the following term lengths and prices:

  • $34.95/month
  • $249/year  $199/year (i.e. $16.5/month) 

On the other hand, Seeking Alpha has three types of pricing plans:

The annual plan pricing is not much different between both Seeking Alpha Premium and Morningstar Premium.

So, which one is right for you?

I would recommend Morningstar Premium if you are a long-term value investor.

You can give Morningstar Premium a try for free for 7 days!

Also, you can take $50 OFF Morningstar Premium if you decide it’s a good fit for you.

But, if you are looking for a stock research and analysis platform that can help you research stock ideas, find the top stock ideas, and uncover great under-the-radar stocks, then I think you should consider Seeking Alpha Premium.

[Limited Time] Claim Your 20% OFF Seeking Alpha Premium

Seeking Alpha Vs Zacks

So, what is the difference between Seeking Alpha and Zacks?

Which one is better for you?

Let’s first look at Zacks Premium.

Zacks Premium is a paid subscription service to provide traders and investors with investment tools and research called “Zacks Rank”(i.e. a type of stock rating).

So, what is Zacks Rank?

How do they calculate the Zacks Rank?

Before we go into the details of how the stock ranking is determined, let’s first understand what is the strategy behind Zacks’ stock-picking system.

Zacks’ stock ranking is founded entirely on one premise:

“Earnings estimate revisions are the most powerful force impacting stock prices.”, according to Zacks’ Founder and CEO, Len Zacks,

So, what that means is that if the stock’s earnings estimate is revised higher, then the Zacks’ rank of the stock will be high.

Conversely, if the stock’s earnings estimate is revised lower, then the Zacks’ rank of the stock will be low.

Now, what does Zacks get all the stocks’ earnings estimates?

It collects and analyzes the stocks’ earnings estimates from all the brokerage analysts that follow the stocks.

Then, it uses a mathematical formula to calculate the Zacks’ Rank of the stock based on the following four inputs:

  • Agreement (i.e. the extent to which all analysts are revising their earnings estimates in the same direction. The greater the percentage of analysts that are revising their estimates higher, the better the score will be for this component.)
  • Magnitude (i.e. the size of the recent change in the current consensus earnings estimate for the fiscal year and the next fiscal year. The higher, the better the score for this component)
  • Upside (i.e. the difference between the most accurate estimate as calculated by Zacks and the consensus estimate. A bigger difference between the most accurate estimate and the consensus estimate is better)
  • Surprise (i.e. Zacks also factors in the last few quarters’ earnings per share (EPS) surprise. Companies with a positive earnings surprise are more likely to surprise again in the future)

Each one of the above-mentioned components is given a raw score which is then used to calculate Zacks Rank.

As this raw score is recalculated every night, Zacks Ranks will be updated every day as well.

There are a total of 5 different ranks:

  • Zacks Rank #1 (i.e. Strong Buy)
  • Zacks Rank #2 (i.e. Buy)
  • Zacks Rank #3 (i.e. Hold)
  • Zacks Rank #4 (i.e. Sell)
  • Zacks Rank #5 (i.e. Strong Sell)

When Zacks Rank issues a “Strong Buy” or “Buy” (Zacks Rank #1 or #2), what it means is that the stock’s earnings estimates are rising.

If the stock’s earnings are going to be more than expected, then the stock would be undervalued and the stock price would likely go up.

When Zacks Rank issues a “Strong Sell” or “Sell” (Zacks Rank #5 or #4), what it means is that the stock’s earnings estimates are declining.

If the stock’s earnings are going to be less than expected, then the stock would be overvalued and the stock price would likely go down.

However, these stock ratings are ONLY for short-term trading (i.e. the next 1 to 3 months), but not for long-term investment.

Here’s why.

Publicly traded companies are required to report their quarterly earnings, so the “earnings estimate revisions” indicator that Zacks uses is ONLY valid for at most one quarter (i.e. 3 months).

So, if you are into stock trading and trying to profit from the short-term price movement, then you might find Zack’s rank useful.

Now, how does Zacks Premium compare against Seeking Alpha Premium?

Seeking Alpha Premium provides stock ratings as well:

  1. SA Author Ratings ‒ ranging from Strong Buy to Strong Sell
  2. Wall Street Ratings – consensus and price targets on the stock by Wall Street Analysts
  3. Quant Ratings ‒ based on over 100 metrics, updated daily

Quant Rating is derived after taking into account the following five “Factor Grades”:

  • Value
  • Growth
  • Profitability
  • Momentum
  • EPS Revisions

As you can see, Seeking Alpha’s Quant Rating also uses “earning estimate revision” as one of the five factors in its calculation.

On the other hand, Zacks Rank only uses one single factor “earning estimate revision” in its calculation. 

Personally, I have more confidence in Seeking Alpha’s Quant Rating than Zacks Rank.

Now, let’s compare the performance of Seeking Alpha’s Quant Rating and Zacks #1 Rank.

Here’s Zacks #1 Rank performance.

From Jan 1, 1988 to Jan 3, 2022, Zack #1 Rank had an average annual return of 25.4% based on a hypothetical portfolio consisting of all the Strong Buy stocks while the S&P 500 had an average annual return of 11.5%.

But, there are a couple of problems with this.

The performance is based on a monthly re-balancing or weekly re-balancing of the hypothetical portfolio, but Zack’s Stock Rank is updated daily.

So, it would not have accurately reflected the actual performance.

On top of that, zero commission is assumed for the calculation of the performance.

That means the actual performance is much lower.

Now, what about the performance of Seeking Alpha Quant Rating?

From 2010 to 2022, Seeking Alpha Strong Buy achieved a total return of $174,156 based on $10,000 in investment capital while S&P 500 achieved a total return of $40,721.

That translates to an average annual return of 27% by Seeking Alpha’s Strong Buy Recommendations.

Do take note that the performance is based on back-testing.

For Seeking Alpha Quant Rating Performance, the good thing is that they re-balance the hypothetical portfolio of the Strong Buy stocks daily and then calculate the performance.

So, in a sense, Seeking Alpha’s performance would be closer to the actual performance than Zack’s.

Now, are there any other differences between Seeking Alpha and Zacks?

Seeking Alpha Premium gives you access to thousands of stock analysis articles written by experts in the investing community while Zacks gives you equity research reports.

But, on Seeking Alpha, you will be able to see the in-depth stock analysis by the authors who are bullish as well as the authors who are bearish.

This is important to me because it helps me understand better the potential risks involved in the stocks that I am interested in.

On top of that, Seeking Alpha Premium is very useful to both long-term stock investors as well as traders because you can use its tools to uncover a lot of great investment ideas.

On the other hand, Zacks Premium seems to be more limited and is mainly designed for short-term stock traders.

Lastly, let’s compare the pricing between Seeking Alpha Premium and Zacks Premium.

Zacks Premium costs $249 per year with a free 30-day trial period.

On the other hand, Seeking Alpha has three types of pricing plans:

Pricing-wise, Seeking Alpha Premium is slightly cheaper than Zacks Premium, but I think you get much more value from Seeking Alpha Premium.

[Limited Time Only] Claim Your 20% OFF Seeking Alpha Premium

Seeking Alpha Vs TipRanks

Lastly, how does Seeking Alpha Premium compare with TipRanks Premium?

Both Seeking Alpha Premium and TipRanks Premium provide you with stock ratings.

The Smart Score is a proprietary quantitative stock scoring system created by TipRanks.

It gives stocks a score from one to ten, based on 8 market key factors.

The lowest score is 1 and the highest is 10.

The scoring system works as follows:

  • Stocks with a score of 8, 9, or 10 are considered Outperform
  • Stocks with a score of 4, 5, 6, or 7 are considered Neutral
  • Stocks with a score of 1, 2, or 3 are considered Underperform

So, how does it calculate its Smart Score?

It uses the following eight market factors:

  • Wall Street Analyst ratings
  • Corporate insider transactions
  • Financial blogger opinions
  • Individual investor sentiment
  • Hedge fund manager activity
  • News sentiment
  • Technicals
  • Fundamentals

There are a few problems with this.

First of all, TipRanks picks up all ratings made on stocks on US markets that are publicly published online.

By using Natural Language Processing, it monitors reputable websites to find new ratings.

So, that means it is only using what its web scraper can find on the internet to calculate the Smart Score.

Not all analysts’ ratings are published publicly online.

Also, how do you ensure that you collect the rating in a timely manner?

So, that does not sound like a reliable source of raw data at all to me.

Moreover, hedge fund manager activity is only revealed within 45 days after the end of each calendar quarter through form 13-F that they’ve filed with the SEC.

In other words, the data is extremely delayed.

All in all, I don’t really have confidence in the Smart Score.

Pricing-wise, TipRanks Premium costs $29.95/month which is much more expensive than Seeking Alpha Premium.

So, I would recommend Seeking Alpha Premium over TipRank Premium.

[Limited Time Only] Claim Your 20% OFF Seeking Alpha Premium

 

About Gladice Gong

Gladice Gong is an ex-proprietary trader. She is also a personal finance writer with many years of experience investing and trading the stock market.

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